During the past five years bankers have reaped billions of dollars in profits by simply making accounting entries instead of making loans. What was the biggest source of banking industry profit growth over the past five years? As noted repeatedly in FDIC Quarterly Banking Profile reports, the biggest contribution to earnings growth has come from […]
Banks Have Just Lost Their Biggest Profit Center – What Will Replace Billions of Profits from Loan-Loss Releases?
November 26, 2014 By Leave a Comment
Fed Reports Sharp Increase in Banking Mergers and Acquisitions
November 25, 2014 By Leave a Comment
The first semiannual report on banking applications activity by the Federal Reserve shows a sharp increase in mergers and acquisitions during the first six months of 2014. The Federal Reserve, as one of the primary U.S. regulators, reviews applications from bank holding companies, state member banks, foreign banking organizations, and savings and loan companies. Applications […]
Home Equity Loans – Why Banks and Borrowers Both Love Them
October 12, 2014 By Leave a Comment
With interest rates at all time lows why wouldn’t banks love handing out home equity lines of credit (HELOC)? Since HELOCs are all written as adjustable rate second mortgages any increase in interest rates translates into instantly higher profits for banks. With a HELOC the borrower takes on interest rate risk as opposed to a […]
Would Bank Living Wills/Resolution Plans Actually Help Resolve the Next Banking Crisis?
July 2, 2014 By Leave a Comment
The public portions of the annual resolution plans or living wills of 17 large financial institutions were jointly released by the FDIC and the Federal Reserve Board today. The resolution plans describe in detail a financial institution’s plans for a rapid and orderly resolution under the U.S. Bankruptcy Code to address material financial distress or […]
Mortgage Default Rates Soar for Senior Citizens as Feds Loosen Mortgage Rules for Seniors
May 20, 2014 By 1 Comment
The Consumer Financial Protection Bureau (CFPB) is concerned about the rapidly increasing default rate on mortgages held by senior citizens. A study done by the CFPB shows that the number of senior citizens with mortgage debt has increased, the amount of debt owed has increased, and default rates have risen. According to the CFPB since […]
AztecAmerica Bank, Berwyn, Illinois, Seventh Bank Failure of 2014
May 16, 2014 By Leave a Comment
AztecAmerica Bank, Berwyn, Illinois was closed today by state regulators and the FDIC was named as receiver. Founded in September 2005 at the height of the real estate boom, AztecAmerica remained a small bank with assets of only $66 million at the time of its failure. The Bank was founded with the intent of appealing […]
Oops! My Calculator was Broken – Red Faces for both Bank of America and the Fed
April 29, 2014 By Leave a Comment
One “tiny little error” resulted in red faces at both Bank of America (BAC) and the Federal Reserve when bank officials disclosed they had incorrectly calculated capital levels required for the annual stress tests. The Fed apparently did not notice the error until Bank of America notified them. This would all be very funny except […]
FDIC Issues 40 Enforcement Actions
April 26, 2014 By 2 Comments
The FDIC issued a list of 40 enforcement actions taken against banks and individuals during March 2014. The enforcement actions include the following: 4 consent orders 1 prompt corrective action directive 9 section 19 orders 14 orders terminating consent orders and cease and desist orders 1 order terminating a prompt corrective action 2 civil money […]
Most Americans Still Don’t Trust Banks and Here’s Why
April 5, 2014 By 1 Comment
Six years after the near melt down of the United States banking industry in 2008, more than half of all Americans still lack confidence in both the banking system and the government. Interestingly the United States with some of the biggest banking institutions in the world and the implicit backing of the United States Treasury […]
Bank ATMs Are Easy Target for Criminals
April 2, 2014 By 1 Comment
As if banks didn’t have enough problems to worry about, a recent government report reveals that theft from ATM machine was become a widespread problem. The alarm bell on ATM fraud was sounded by an organization that most Americans have never heard of – the Federal Financial Institutions Examination Council (FFIEC) – which acts as […]